Economics trumps politics, at last

PM Manmohan Singh has finally called a spade a spade. Hinting at the current politico-economic scenario in the country, he called upon politicos, policymakers and the industry to shake off the slumber and get down to serious business to arrest the decline in growth.

PM Speak–

“Scenario one is called “Strong Inclusive growth”. It presents what is possible if the policy actions outlined in the Plan are substantially implemented. One can expect a number of virtuous cycles to start operating, leading to positive results on both growth and inclusion. This is the scenario we should aim for.

Scenario two is called “insufficient action”. It describes a state of partial action with weak implementation. The virtuous cycles that reinforce growth in Scenario I, will not kick in, and growth can easily slow down to 6 to 6.5 percent. Inclusiveness will also suffer. This is where we will end up if we make only half-hearted efforts and slip in implementation. It is my sincere hope that we do not do so.

Scenario three is called “policy logjam”. It reflects a situation where for one reason or another, most of the policies needed to achieve Scenario 1 are not taken. If this continues for any length of time, vicious cycles begin to set in and growth could easily collapse to about 5 percent per year, with very poor outcomes on inclusion. I urge everyone interested in the country’s future to understand fully the implications of this scenario. They will quickly come to an agreement that the people of India deserve better than this.

I believe we can make Scenario I possible. It will take courage and some risks but it should be our endeavour to ensure that it materialises. The country deserves no less.

DISCLAIMER : Views expressed above are the author's own.

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Author

Soma Banerjee is the National Economics Editor of The Economic Times. A journalist for two decades, she has written on government and policy extensively. Tracking the growth of infrastructure with special emphasis on energy has been the cornerstone of her writings. She has also worked with ET Now, ET's business channel and has anchored some special shows. Her blog, Energy Quotient will cover major developments in the energy and infrastructure sectors even as she dabbles on other "energizing" issues from time to time.

Soma Banerjee is the National Economics Editor of The Economic Times. A journalist for two decades, she has written on government and policy extensively. Tr. . .